Embraer Readies KC-390 for LAAD Spotlight

Apr. 3, 2013 - 02:42PM
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SAO JOSE DOS CAMPOS, BRAZIL — As Brazil’s largest defense company, Embraer Defense & Security will be well represented at LAAD Defense & Security expo this month. And the crown jewel the company will be showcasing is its KC-390 transport aircraft, which the company expects to compete with the Lockheed Martin C-130 on the world market.

For Embraer, the KC-390 marks a serious change in corporate thinking for a company that traditionally designs products for Brazil, then looks for other countries with similar needs. With the KC-390, Embraer launched a comprehensive study of the market internationally and decided there was a need for a competitor to Lockheed’s C-130J model.

“When we thought about this airplane, it was the first time we looked at the international market also, not just the Brazilian requirements,” Luiz Carlos Aguiar, the company’s CEO, said during a March 14 interview conducted as part of a company-sponsored trip for reporters to Brazil. “We saw there were 2,000 old airplanes all over the world in more than 70 countries, very well spread out with a diversified base of potential customers. We looked at that and saw there was only one aircraft available in the market being produced and being delivered.”

Aguiar believes “our great star” could have a market worth $50 billion.

As of now, the plane exists primarily on paper, although a flight simulator and mockup of the cabin were shown to reporters. But Embraer took a major step forward with the March 25 announcement that the plane had completed its critical design review, which signals that the design is mature enough to begin manufacture of a prototype.

A spokesman for the company declined to comment on what news Embraer would be announcing at the show, which runs April 9-12 in Rio de Janeiro, but a contract announcement with the Brazilian government for a first batch of KC-390s might be imminent.

‘On Track’

Paulo Gastao Silva, Embraer’s program vice president for the KC-390, told reporters on March 13 that the company is committed to launching the first flight of the plane in the second half of 2014, more than five years since development contracts were signed in April 2009. Embraer plans to deliver the first planes in late 2015 or early 2016.

Costs for the new plane are “on track,” Silva said, with development costs slightly falling. However, Silva declined to provide a unit cost for the plane, saying only that it “must be competitive with respect to” the

C-130. He estimated that the Brazilian government will invest $2.3 billion to $2.4 billion in development and preparation costs by the time the plane is in production.

Although the KC-390 is designed as a transport, Silva emphasized its “multirole” capabilities. During his presentation, he highlighted both firefighting and search-and-rescue roles, which are enhanced by the inclusion of an electro-optical/infrared pod on the plane. Other features of the plane include a fly-by-wire system, an advanced communications suite and a defense suite that includes chaff and radar warning systems.

The plane would transport 80 Brazilian troops, or 64 paratroopers; cargo-wise, it would carry seven 108-by-88-inch pallets. The plane also would come equipped with two probe-and-drogue refueling pods and a refueling probe on top of the cockpit. It would carry enough fuel to resupply four Boeing F/A-18s, five Dassault Rafales or eight Saab Gripen fighters, Silva said.

However, he quickly dismissed any suggestion the plane could enter the international market as a full-time tanker. The

KC-390 “brings organic tanker capability, but it’s not a large tanker. It could not compete just on a tanker market,” Silva said, adding that attempts to turn the transport into a tanker were unlikely, as they would require major modifications to the airframe.

Silva also said the company has held preliminary discussions with the Brazilian postal service about a commercial version of the aircraft.

Beyond Aerospace

The company nearly quintupled its revenue in the past six years, growing from $227 million in 2006 to more than $1 billion in 2012. With that growth, Embraer has eyed ways for the company to expand as an aerospace manufacturer.

“We are manufacturers of aircraft, yes, but today we are proposing and executing projects that surpass the great complexity of creating an aircraft,” Aguiar said in a March 14 speech to reporters. As examples, Aguiar pointed to the company’s purchase of strategic assets such as radar firm Orbisat and C4I company Atech.

Yet the company is not abandoning its aerospace arm. In addition to the KC-390, Embraer will showcase its A-29 Super Tucano at LAAD. Fresh off its selection by the U.S. Air Force to supply 20 of the single-propeller planes to the Afghanistan military, Aguiar said he believes the market for the fighter could be worth $4 billion, with more than 340 planes in operation by 2025.

He added that the U.S. Air Force selection of 20 Super Tucanos for the Afghan Air Force could open more markets around the world.